President Barack Obama did not lose Iraq, he gave it away: Al Qaeda and the ISIS take over major cities

Iraq is facing its gravest test since the US-led invasion more than a decade ago, after its army capitulated to Islamist insurgents who have seized four cities and pillaged military bases and banks, in a lightning campaign which seems poised to fuel a cross-border insurgency endangering the entire region.

The extent of the Iraqi army's defeat at the hands of militants from the Islamic State of Iraq and Syria (Isis) became clear on Wednesday when officials in Baghdad conceded that insurgents had stripped the main army base in the northern city of Mosul of weapons, released hundreds of prisoners from the city's jails and may have seized up to $480m in banknotes from the city's banks.

Iraqi officials told the Guardian that two divisions of Iraqi soldiers – roughly 30,000 men – simply turned and ran in the face of the assault by an insurgent force of just 800 fighters. Isis extremists roamed freely on Wednesday through the streets of Mosul, openly surprised at the ease with which they took Iraq's second largest city after three days of sporadic fighting.